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A local startup accelerator called the Hughes Fund, made up primarily of local investors, has invested in six local companies in the Tri-Cities area and has more on the way.
Fuse is a Tri-Cities business and community accelerator created to support startups with resources such as a coworking space on Richland Parkway.
Fuse Fund began as a natural outgrowth of Fuse in 2019 as a way to connect startups with funding.
This is the only startup fund focused on local companies in the Tri-Cities, said Marty Conger, former chief financial officer of Pacific Northwest National Laboratory and managing partner of Hughes Advisors. said.
Marty Conger is restarting fundraising efforts for the Fuse Fund, an initiative of Richland’s Fuse SPC Business Incubator to invest in promising local companies. He raised nearly $1.5 million of the fund’s $2 million goal, but the pandemic slowed efforts. (TCAJOB file photo)He said he created the Hughes Fund to fund startups that “ideally have a physical presence here in the Tri-Cities, but more importantly do business here.”
Although there was a temporary hiatus in the fund’s progress due to the pandemic, the Hughes Fund was successful in raising $2 million and has invested 60% of its funds in six companies to date.
Conger said he raised the money from about 30 mostly local investors. While it is ideal to earn a profit from your investment, it is also an altruistic goal.
“They’re all interested in the Tri-Cities and think the Tri-Cities is a good place for startups,” Conger said.
Fuse Fund played a variety of roles with startups and was a minority investor in half of the companies. For the other half, Fuse Fund was the original investor.
Conger said having just one investor can make the difference between a startup’s ability to secure further funding elsewhere.
Conger said there is still funding available for startups right now.
The problem is that startups need to have ties to the Tri-Cities. This means you must be based in or do business in Benton or Franklin counties.
Once the Hughes Fund is depleted, investors on the group’s board can set up another fund, but for now there is still the ability to invest in a few more startups.
Conger emphasized that the Hughes Fund invests in a variety of companies and no business area is off-limits. However, local connectivity is non-negotiable.
Fuse Fund has investments in Carbitex, Brook, STARS Technology Corp., LiveGrowBio, and Innov8Ag.
The sixth company the Hughes Fund invested in has already gone out of business, but Conger said that’s the nature of startups.
Hughes also works with unfunded companies.
“There are several other startups that we have supported without investing, and a lot of people are surprised when we say we will support them without investing,” Conger said.
He encouraged local startups to contact them if they need resources or support or are interested in applying for funding.
Conger initially worried whether enough businesses would apply for funding, but that wasn’t the case. So far, we have received requests from approximately 20 companies.
They must submit a plan to the Hughes Fund Investment Committee.
“We were pleasantly surprised to find a quality company here that could use our support and meet our criteria of being local,” Conger said.
The board’s hope is that while realistically most startups fail, investors can triple their returns over the life of the fund.
“It’s been a great journey so far. We’ve made some great investments, but it’s been a tough road to see them through to full value,” Conger said.
The Hughes Fund’s board of directors consists of Conger; Brett Spooner, founder of Hughes. Ron Boninger, entrepreneur and former CEO of Carbitex. Megan Rose, founder of Iron Mountain Management; And Gerry Cochran, who recently joined the board, is now a startup investor in PNNL.
The Hughes Investment Committee is comprised of board members and additional members: Ken Arneson, entrepreneur and technology startup founder; Brian Thomas, former CFO of Washington River Protection Solutions. And we were recently joined by Jonathan Cox, an agricultural technology entrepreneur.
For more information, visit fuse.fund.
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